While we don’t have a crystal ball to show you what the future will hold, we can try to predict what you can expect. From a more manageable increase in home price to an increase in new home builds to combat the increasing existing home inventory shortage, here is a look into some real estate market predictions for 2018.
Real Estate Market Predictions
While home prices will continue their upward trend, they will not be as steep as we have seen in recent years. Expect for home values to rise 3.2 percent in 2018 – the slower pace allowing for home sales to pick up. Although home prices will slow, many homes are still expected to be out of reach for first-time homebuyers.
It looks as if mortgage rates are expected to average 4.6 percent throughout 2018 and reach five percent for a 30-year fixed-rate mortgage by the end of the year. According to the Mortgage Bankers Association, rates will continue to rise – predicted to pass four or even five percent over the next couple of years.
Existing Home Sales
Home sales, despite the continued low inventory, are expected to increase by 2.5 percent in 2018.
New Home Builds
To combat low inventory, new home builds are expected to increase in 2018. Experts predict a three percent rise in overall housing starts and a seven percent increase in single-family home starts.
New Home Sales
The increase in new home builds is expected to spark the same increase in new home sales – seven percent.
After hitting rock bottom in the second quarter of 2016, realtor.com is predicting the homeownership rate will normalize in 2018 – at 63.9 percent.
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